India's Ban on Mastercard for Not Complying With Data Storage Rules Said to Hit Banks' Card Operations

 India's Ban on Mastercard for Not Complying With Data Storage Rules Said to Hit Banks' Card Operations

RBI said Mastercard did not comply with 2018 rules requiring foreign card networks to store Indian payments data locally.

Mastercard has said it is "disappointed" with the decision and will work to resolve the concerns

HIGHLIGHTS

• New issuance of such cards will stop from July 22
• Existing customers will not be hit
• Switch to Visa could take as long as five months

India's decision to ban Mastercard for non-compliance with data storage rules has unsettled the country's financial sector as it will disrupt banks' card offerings and hit revenues, payments, and banking industry executives told Reuters.

Wednesday's central bank order followed similar action in April against American Express, but Mastercard is a much bigger player in the Indian market, where many lenders offer cards using the US firm's payments network.

A Reuters analysis of online card listings of 11 domestic and foreign banks in India showed Mastercard accounted for about a third of roughly 100 debit cards on offer, and more than 75 credit card variants used its network.